CCK slashes fees to spur investment

October 7, 2011
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, NAIROBI, Kenya, Oct 7 – The Communications Commission of Kenya (CCK) has revised downwards a wide range of licensing and spectrum fees as it seeks to motivate players to expand services countrywide.

Mobile frequencies have been lowered by an average of 41 percent while the frequency charges for fixed wireless access – used for data networks – have been slashed by approximately 18 percent.

“The formula for fixed links has been modified so that the fees will be charged at the rate of 100 percent of the current fees for the first 50 transmitters, 75 percent for the next 50 transmitters and 50 percent of the remaining number of transmitters,” CCK acting Director General Francis Wangusi explained.

And to ensure that operators do not hoard or misuse spectrum, the regulator has slapped a Sh240,000 minimum fee for every assigned 1 MHz frequency pair.

Small and Medium-sized Enterprises as well as start-up companies also have something to smile about with all the requisite application and annual operating fees lowered to promote compliance.

“To encourage smaller vendors and contractors to seek type approval for equipment meant for sale to end users, type approval fees have been reduced by an average of 80 percent,” Mr Wangusi announced.

It is anticipated that the move will be received well by the market and encourage them to bring in genuine IT equipment and devices such as mobile handsets.

Wangusi said the adjustment was informed by the need to further spur development of the Information and Communication Technology sector (ICT) which has over the last one decade become a great contributor to the economy.

“The review has been underlined by the need to stimulate infrastructure investment and development and the attainment of universal access among other public policy considerations,” Wangusi added.

It is also in response to complaints by many operators that the high cost of laying their infrastructure was hampering their efforts to rapidly expand their services to the country’s rural and remote areas.

With the new tariff regime which becomes effective from July 2012 however, the operators will be expected to utilise the frequency resources effectively.

Hoarding will be frowned upon and service providers with unutilised spectrum will be expected to surrender them to the regulator.

Although some piecemeal reviews have been undertaken over the last few years, no attempt has been made to have a general review of the regulatory fee structure which was adopted in 2000.

This has in part being one of the factors that communication services have been costly but now, operators will be obliged to pass on the benefits to end users.

With a promise to keep a hawk-eye on whether the operators are offering affordable communication services to their customers, Wangusi pledged that the regulatory levies would be reviewed every three years while taking into account the developments in the sector.

These developments include the migration to the new licensing regime for broadcasters which the regulator is adamant must happen despite the opposition from several quarters.

Broadcasters have until November 15 to apply for new licenses and the Communications Commission of Kenya is relentless in ensuring that this requirement is met.

“We affirmatively say yes; broadcasters are required to reapply their licenses by mid next month,” he stressed adding that they are currently processing applications from 75 percent of the broadcasters.

The call by the regulator to have broadcasters reapply for their permits has kicked off a storm with several investors terming the move as ‘unconstitutional’.

The regulator has however warned that broadcasters who do not comply with the set conditions will have their operations shut down upon the expiry of the deadline.

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